Dana Corporation Signs Letter of Intent to Acquire Full Ownership of Core Operations in Mexico
22 November 2005 - 3:23PM
PR Newswire (US)
TOLEDO, Ohio, Nov. 22 /PRNewswire-FirstCall/ -- Dana Corporation
(NYSE:DCN) announced today that it has signed a letter of intent
with DESC S.A. de C.V. under which Dana will acquire full ownership
of several core operations based in Mexico. Under terms of the
letter, Dana and DESC will dissolve their existing joint venture
partnership, Spicer S.A. de C.V., with Dana assuming 100-percent
ownership of operations that manufacture and assemble axles and
driveshafts, as well as forging and foundry operations in which
Dana currently holds an indirect 49-percent interest. DESC, in
turn, will assume full ownership of the transmission and
aftermarket gasket operations in which it currently holds a
51-percent interest. (Logo:
http://www.newscom.com/cgi-bin/prnh/19990903/DANA) The
transactions, which are expected to be completed in the first
quarter of 2006, are subject to the negotiation and execution of a
definitive agreement, approval by Dana's Board of Directors, and
customary regulatory approvals. "These transactions will provide
Dana with a strategic opportunity to strengthen our core axle and
driveshaft businesses with vertically integrated and
technologically advanced operations in a key geographic location,"
said Dana Chairman and CEO Mike Burns. "As a result, Dana will be
positioned to benefit from low-cost manufacturing efficiencies, as
well as top-line growth from fully owned core operations in
Mexico." Facility Overview Under the letter, Dana will acquire full
ownership of five manufacturing operations, which had combined
sales -- both to Dana and to parties other than Dana -- of $290
million (USD) for the trailing 12 months ended Sept. 30, 2005. The
facilities, Autometales, S.A. de C.V.; and Ejes Tractivos, S.A. de
C.V. in Mexico City, and Cardanes, S.A. de C.V.; Engranes Conicos,
S.A. de C.V.; and Forjas Spicer, S.A. de C.V. in Queretaro, produce
light vehicle axle and driveshafts and a variety of related
components. DESC will assume full ownership of Transmisiones y
Equipos Mecanicos, S.A. de C.V. (Tremec) and Transmisiones TSP,
S.A. de C.V. (TSP) transmissions, located in Queretaro, Mexico;
Transmission Technologies Corporation (TTC) with operations in
Knoxville, Tenn.; and the T.F. Victor, S.A. de C.V. aftermarket
gasket operation in Mexico City, Mexico. Dana will sell aftermarket
gaskets in Mexico through T.F. Victor and original equipment
gaskets directly to engine and vehicle manufacturers. About Dana
Corporation Dana people design and manufacture products for every
major vehicle producer in the world. Dana is focused on being an
essential partner to automotive, commercial, and off-highway
vehicle customers, which collectively produce more than 60 million
vehicles annually. A leading supplier of axle, driveshaft, engine,
frame, chassis, and transmission technologies, Dana employs 46,000
people in 28 countries. Based in Toledo, Ohio, the company reported
sales of $9.1 billion in 2004. Dana's Internet address is:
http://www.dana.com/. Forward-Looking Statements Statements in this
release regarding the anticipated transactions under the letter of
intent between Dana and DESC constitute "forward-looking"
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements represent Dana's expectations
based on its current information and assumptions. Forward-looking
statements are inherently subject to risks and uncertainties and
there can be no assurance that these transactions will be completed
as contemplated. Dana does not undertake to update any
forward-looking statements in this release.
http://www.newscom.com/cgi-bin/prnh/19990903/DANA
http://photoarchive.ap.org/ DATASOURCE: Dana Corporation CONTACT:
Investor Relations, Michelle L. Hards, +1-419-535-4636, or , or
Media Relations, Todd M. Romain, +1-419-535-4727, or , both of Dana
Corporation Web site: http://www.dana.com/ Company News On-Call:
http://www.prnewswire.com/comp/226839.html
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